Traffic Pumping

When you make a long distance call, that call is generally handled by a
number of telephone companies – Your local carrier delivers the call from your
phone to a long distance company, the long distance company carries the call
most of the way to its destination, and then the call is handed off to the local
carrier that serves the party you’re calling. Under today’s rules, the long
distance company pays a fee, called an “access charge,” to the local carrier
that delivers the call to the called party.

Access stimulation, also referred to as “traffic pumping,” occurs when a
local carrier with high access charge rates enters into an arrangement with
another company with high call volume operations, such as chat lines, adult
entertainment calls, or “free” conference calls. The arrangement inflates or
stimulates the number of calls into the local carrier’s service area, and the
local carrier then shares a portion of its increased access revenues with the
“free” service provider, or provides some other benefit to that company. The
local company’s profits from such an arrangement are typically so great that its
charges become unreasonable and unlawful under FCC regulations.

Access stimulation is harmful to consumers and competition in a number of
ways. First, it distorts investment incentives. As a result of an access
stimulation scheme, the long distance companies are forced to recover the
inflated access costs from all of their customers, even though many of them do
not use the services that caused the stimulation in demand. It also harms
competition by giving companies that offer, for instance, free conference
calling services a competitive advantage against companies that charge their
customers for the service.

Allegations of access stimulation have led to a number of disputes between
local and long distance telephone companies, a number of have been resolved by
the Commission through a formal complaint process[1].